Chillin'Competition

Relaxing whilst doing Competition Law is not an Oxymoron

Update on Uber and Transport for London (and how procedures shape substance)

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Transport for London

It makes sense to announce in the blog, before it is too late, that Transport for London has dropped the proposals I discussed at the beginning of last month. No doubt, TfL realised that they were indefensible.

As I suggested then, another factor may have played a role in this outcome. Maybe, TfL and the incumbents pushing to ban or water down Uber have been victims of the well-known Tyranny of the Status Quo. It is very difficult to alter the balance of interests that results from the status quo. This has been Uber’s bet all along in every city and it appears to have worked in London: move fast and expand so there is no way back. The Tyranny of the Status Quo typically works to prevent desirable regulatory change. Uber’s genius has been to turn it on its head.

It is only fair to praise TfL not only for having had the courage to abandon indefensible changes in regulation, but for the transparency and the openness of the procedure. Unfortunately, the desirability of regulatory change has not been the subject of a proper debate in many Member States. Coercion and violence, more than a proper discussion of ideas and evidence, have often been the means through which the issue has been addressed. It is refreshing to see a regulator inviting the public to submit comments and taking them seriously.

The Uber v TfL saga teaches an important lesson to competition lawyers. I insist on it in my work. Substance and procedure and mutually intertwined. The institutional structure through which a regime is enforced has a significant impact on the content of the law. Desirable regulatory change is more likely to occur in an open and transparent procedure. Conversely, bad ideas are more likely to inform regulation and prevent change where issues are decided in closed rooms.

Another lesson I draw from the saga: not only will it be good for the UK to stay in the EU. It is very important for the EU that the UK stays. But that is a different story…

Written by Pablo Ibanez Colomo

3 February 2016 at 11:05 am

Posted in Uncategorized

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